Boeing: Order from India to save Long Beach jobs - San Jose Mercury News
Boeing: Order from India to save Long Beach jobs
LOS ANGELES—There was excitement at Boeing's Long Beach C-17 assembly plant on Monday after word that a $4 billion order from India for 10 of the giant cargo jets was hours away from two final signatures.
"The plant is abuzz. We knew the order was in the works. The extra planes will get us through 2012. We know numerous, numerous countries are interested in planes in 2013, but 2012 was the gray year. This will allow us to make it through to 2013. It's huge," said Stan Clemchuk, president of United Automobile, Aerospace and Agricultural Implement Workers of America, Local 148.
On Monday, India's Cabinet approved the proposal for the C-17 cargo planes, the largest defense deal between that country and the U.S.
"All that's left now is for the U.S. and Indian governments to sign a letter of offer and acceptance," said Jerry Drelling, Boeing's media relations manager for the C-17 program. That was expected in the next few days.
The C-17 is a flying warehouse that made its debut 20 years ago. It quickly became a war and disaster workhorse. It is built at the only airplane factory left in California.
Drelling said the order "helps us keep the line alive and supports jobs."
Boeing is the largest employer in Long Beach, 25 miles south of downtown Los Angeles, but the impact of the C-17 extends beyond the Southern California city. The plane has an estimated $5.8 billion annual economic impact and the jobs of about 25,000 workers in
states depend on it, Drelling said.
Before the deal with India, the last of the plant's current orders would have been delivered in December 2012, he said.
"It's a great day for Long Beach," Clemchuk said.
Because it is a foreign military sale, negotiations are conducted between the two governments and Boeing is not involved, Drelling said. Anticipation grew when President Obama announced a preliminary agreement when he visited India in November.
"Now we're sort of at the final gate on the whole process," Drelling said.
The U.S. Air Force has ordered 223 of the C-17s, with 12 still being built. Twenty-one of the jets have been delivered to foreign countries—seven to the Royal Air Force, four to Australia, four to Canada, three to a coalition of countries, one to the United Arab Emirates (a second will be delivered later this week), and two to Qatar.
In 2006, it appeared orders for the jets had dried up. Boeing ordered the plant to close and alerted all workers they would soon be laid off.
Doomsday at the plant was averted when the U.S. ordered eight more of the jets, but production was cut from 16 or 17 jets a week to 10, and the company laid off workers to match production.
At the peak of production, around 7,000 salaried and hourly workers were employed. Drelling said about 3,700 salaried and hourly workers are left, but layoffs are still taking place.
"We would rather have them lower the rate and make fewer planes than close all together," Clemchuk said. "If it means the plant stays open, we are all for it."
Closing down is not an option, he said, because it costs so much to restore the plant and all its suppliers. "This will take us out another couple of years. We know other customers are interested, but they need time," Drelling said.
For example, he said, Qatar has an option for two more and Kuwait is in the process of completing an order.
Countries are modernizing, he said. "This is the world's most advanced airlifter. It can fly intercontinental distances with a full load without refueling. It can land on austere runways. It has saved countless lives of U.S. and military troops."
In addition, he said, "it's been the first responder to every major natural disaster in the last decade."
The nation's C-17 fleet has been getting quite a workout with all of the disasters around the world, Clemchuk said.
"It's the only plane in the world that can be turned into an operating room. The humanitarian work it is used for is unbelievable," the union president said.
